Cash dividends b stock dividends c interest d

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Cash dividends B. Stock dividends C. Interest D. Principal payment 19. (CAPITAL BUDGETING) The capital budgeting technique known as payback period uses Depreciation expenseTime value of money A. Yes Yes B. Yes No C. No No D. No Yes 20. (OPERATING & FINANCIAL BUDGETING) Ideally, the number of units that should be produced in a just-in-time manufacturing system is equal to A. the maximum productive capacity for the current period. B. actual customer demand for the current period. C. budgeted customer demand for the current period. D. budgeted customer demand for the following period 21. (OPERATING & FINANCIAL BUDGETING) The preparation of an organization's budget A. forces management to look ahead and try to see the future of the organization. B. requires that the entire management team work together to make and carry out the yearly plan. C. makes performance review possible at all levels of management. D. all of the above. 22. (WORKING CAPITAL MANAGEMENT & FS ANALYSIS)
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MANAGEMENT ADVISORY SERVICES - THEORIES Page 5 Why would a firm generally choose to finance temporary assets with short-term debt? A. Matching the maturities of assets and liabilities reduces risk. B. Short-term interest rates have traditionally been more stable than long-term interest rates. C. A firm that borrows heavily long term is more apt to be unable to repay the debt than a firm that borrows heavily short term. D. Financing requirements remain constant. Numbers 23, 24, 25, 26 and 27 (WORKING CAPITAL MANAGEMENT & FS ANALYSIS) Jason Company is a manufacturer of industrial products and employs a calendar year for financial reporting purposes. These questions present several of Jason’s transactions during the year. Assume that total quick assets exceeded total current liabilities both before and after each transaction described. Further assume that Jason has positive profits during the year and a credit balance throughout the year in its retained earnings account. 23. Payment of a trade account payable of P64,500 would A. Increase the current ratio but the quick ratio would not be affected. B. Increase the quick ratio but the current ratio would not be affected. C. Increase both the current and quick ratios. D. Decrease both the current and quick ratios. 24. The purchase of raw materials for P85,000 on open account would A. Increase the current ratio B. Decrease the current ratio C. Increase net working capital D. Decrease net working capital 25. The collection of a current accounts receivable of P29,000 would A. Increase the current ratio B. Decrease the current ratio and the quick ratio C. Increase the quick ratio D. Not affect the current or quick ratios 26. Obsolete inventory of P125,000 was written off during the year. This transaction A. Decreased the quick ratio B. Increased the quick ratio C. Increased net working capital D. Decreased the current ratio 27. The issuance of new shares in a five-for-one split of common stock A. Decreases the book value per share of common stock B. Increases the book value per share of common stock C. Increases total shareholders’ equity D.
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